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NC law prevents cities from controlling rent prices. Could this bill change that?

High rent prices continue to put a squeeze on many North Carolina families, and one state legislator is pushing a bill that she says would give cities and towns more power to help combat the issue.

State Sen. Lisa Grafstein, a Democrat from Wake County, is the primary sponsor of Senate Bill 225, which would give North Carolina municipalities the power “to enact rent control.” She introduced the bill March 7.

It comes at a time when Charlotte has seen one of the largest increases in rent prices year over year compared to the national average, the Charlotte Observer reported previously, with the same report finding the Raleigh area in a similar situation.

Even if her bill doesn’t pass, Grafstein said, she hopes it will spark more conversation about the need for “creative solutions” to make housing more affordable across North Carolina.

Here’s what Grafstein told the Observer about her proposal:

This interview has been slightly edited for clarity and brevity.

Charlotte Observer: What will the bill do if it becomes law and where did you get the idea?

State Sen. Lisa Grafstein: It would simply remove a barrier at the state level to local governments engaging in what’s broadly called rent control, which really could be any number of different ways that local governments might support folks to be able to stay in or obtain housing.

We know that there’s a housing crisis across the state and that affordability is a huge, huge thing for so many people, including, you know, just folks who work in a town and want to be able to live there or a city like Raleigh, where we have folks who are our firefighters and our teachers who have a hard time affording to live in the areas where they work. So the idea really is just that whatever the town or municipality is can figure out what they want to do, applying for more federal dollars or using city and local dollars to support housing options for people.

So what the state of the law is right now is that there’s a state statute that essentially prohibits local governments from engaging in anything that would be considered quote “rent control.” And so the bill was really just to eliminate that barrier for them.

And then they’d have to obviously navigate all the other provisions in law that are in place, but this would just really be one hurdle out of their way.

And where it came from was, you know, I had constituents get in touch about issues around rents in Raleigh and how difficult it was to find a decent place to live at a rent that people could afford. And that was a theme that I’ve heard a lot over the last year or so as I was campaigning for office.

So the process really was just that I asked the research folks here at the General Assembly to look into what it would take to allow local governments to engage in more support for people. And the answer was simply that there’s a statute that would need to be repealed to create a path for that to happen.

N.C. Sen. Lisa Grafstein, a Raleigh Democrat.
N.C. Sen. Lisa Grafstein, a Raleigh Democrat.

Observer: Have there been instances in past legislative sessions of a similar bill to try and get that statute repealed, or is this the first time?

Grafstein: As far as I understand from the research folks here, I think this is the first time. There have been other bills that were aimed at some of the housing issues. Sometimes there were local bills or other efforts at the state level to put other options in the hands of local governments, like around inclusionary zoning, things like that. But I don’t think there’s been any effort to repeal the rent control statute before.

Observer: Legislative sessions tend to fly by, and there’s just simply not time to get to everything. What do you think the odds are of this bill making it through this session?

Grafstein: It’s sitting in the Rules Committee, and as you know that’s generally not a good thing. I think this is really the beginning of a conversation. My hope is that it spurs a conversation about creative solutions because we all agree there’s a huge problem with affordable housing.

I think we ought to be looking at every tool that’s available. So as those conversations continue, I hope that this is part of that conversation. So I don’t know that this as a standalone bill is going to proceed, but I think it’s part of a larger conversation about what we need to be doing around workforce housing and affordable housing around the state.

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Observer: If the bill were to not pass this session, is it something that you would consider bringing back next session?

Grafstein: Yes, I would for sure.

To me, a lot of the impetus behind this particular bill, too, is we just need to take the handcuffs off (local governments) and let them find creative solutions to the problems in their communities. Because it’s going to be different whether it’s Raleigh, Rocky Mount or Rowan County. Across the state, people just have different sets of challenges, and we just need to not have a state law that gets in the way of their ability to solve the problems.

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Observer: If this were to become law, you mentioned that there’s a lot of ideas out there that this would open the doors to. Are there any particular things that you’ve seen other communities doing that you think would be a good fit, whether it’s in your district or the state at large?

Grafstein: I think probably we’d have to look to other states for things around rent control specifically. But around affordable housing generally, there are models — things like simply a locality purchasing property and single family homes to use as affordable housing or buying into developments that have a certain amount of single family housing that is meant for low income people.

And then, we have other options that again are barred by state law, including things like inclusionary zoning, which gives a lot of cities and towns a lot of flexibility in negotiating with developers to include a certain amount of affordable housing in what they’re building. The local governments really don’t have any leverage in those situations because they don’t have the right to require a certain percentage to be affordable.

And then just subsidizing support for affordable housing because I don’t think it’s really realistic to expect that developers will bear the cost or landlords will bear the cost of reduced rents or houses that don’t sell at market rate, that sort of thing. I think there has to be some sort of support for it, whether it’s at the state or local level.